European Stocks Head for Lower Open

European stocks closed sharply higher on Tuesday, gaining some traction following multiple muted sessions with strong support from financials and consumer discretionary companies. The Eurozone's STOXX 50 added 0.7% to 6,022 and the pan-European STOXX 600 gained 0.5% to 621.4, decimals away from the record high touched last week. Banks closed sharply higher and insurers gained for a second session, benefiting from another positive session for benchmark sovereign bonds. UniCredit, BNP Paribas, and AXA gained between 1.7% and 2.7%. Meanwhile, auto producers and luxury brands were supported by the outlook of a slash to metal tariffs by the United States and hopes of strong retail sales in China in their holiday period. LVMH, Mercedes Benz, and BMW gained between 2.5% and 1%. In turn, Bayer surged 7.5% as it prepared to announce a $10.5 billion settlement on future cancer lawsuits over its Roundup weedkiller.

European shares inched higher on Tuesday, with the EURO STOXX 50 up 0.2% at 5,990 and the STOXX Europe 600 adding 0.1% to 619, as softer UK wage data supported rate cut expectations. Figures from the Office for National Statistics showed average weekly earnings, including bonuses, rose 4.2% in Q4, below forecasts, strengthening the case for further easing by the Bank of England. On the corporate front, Antofagasta slid more than 3% despite reporting a 52% surge in 2025 core profit, driven by strong copper prices. Shares in InterContinental Hotels Group rose 0.5% after fourth-quarter room revenue topped forecasts. Spain’s Enagás edged slightly higher even as it warned of lower profit in 2026 following a 2025 boost from asset sales. Meanwhile, Elliott Management has reportedly built a more than 10% stake in Norwegian Cruise Line Holdings and plans to push for changes.

European equity markets were set for a weaker open on Tuesday as risk appetite deteriorated, with geopolitical tensions in the Middle East and persistent concerns over AI disruption across certain sectors weighing on sentiment. Investors are also preparing for key economic releases, including final German inflation data, UK labor market figures, and the ZEW economic sentiment surveys for both the Eurozone and Germany. Corporate earnings are due from several major European names, including Antofagasta, InterContinental Hotels Group, Kerry Group, Carrefour, and Enagás. In premarket trading, Euro Stoxx 50 and Stoxx 600 futures were both down about 0.3%.